Vatukoula Gold Mines identifies new mineralized structures at flagship gold mine in Fiji

Vatukoula Gold Mines (AIM: VGM) said the exploration drilling programme at its flagship Vatukoula gold mine in Fiji identified multiple mineralized structures, producing grades of up to 6.57 g/t (grammes per tonne).

Initial drilling intersected multiple mineralized structures around old surface operations including the President Dyke, which were interpreted to be open along strike and depth and intersections included 5.35 metres grading 5.97 g/t, 6.03 metres at 2.06 g/t, 2.85 metres at 5.38 g/t and 1.45 metres at 6.57 g/t.

The 10 hole diamond drilling programme, which is now complete with all 10 holes having been drilled, was targeting the near surface extension of the President Dyke and associated gold mineralisation neat the Korowere hill area.

In addition to the current drilling programme, historical surface mapping and drill intercepts will be used to develop an exploration programme to delineate the extent of the mineralisation to estimate a Mineral Resource and possibly a Mineral Reserve for the oxidised mineralisation.

Should this be successful, all of Vatukoula’s leases will be reviewed in the wider region for potential oxidised mineralization, which could be included in the long term plan for the mine. The oxide material that is being evaluated within the current exploration programme was not included in the mineral reserve and mineral resource estimate announced earlier this month.
That assessment put the company’s proven and probable mineral reserves at 1.9 Mt (million tonnes) of ore grading 10.9 g/t (grammes per tonne) of gold for 0.68 Moz (million ounces), based on a gold price of US$750/oz and projected operating costs of US$107 per tonne of ore, which could increase about 20% if the assumed price were raised to US$1,050/oz.


The underground combined measured and indicated resource is at 8.3 Mt (million tonnes) grading 10.5 g/t of gold for 2.8 Moz, while the inferred mineral resource amounts to 4.7 Mt grading 8.6 g/t for 1.3 Moz.


Tailings based combined measured and indicated mineral resource now stands at 5.2 Mt grading 1.5 g/t for 0.23 Moz of gold.

Growth Equity and Company Research (GE&CR) issued a 'buy' recommendation with a target price of 3.9p per share for Vatukoula shortly after the resource update was released, saying the emerging gold company is materially undervalued.  http://www.proactiveinvestors.co.uk/companies/news/12550/vatukoula-gold-mines-identifies-new-mineralized-structures-at-flagship-gold-mine-in-fiji-12550.html